These U.S. Metros Could Be First-Time Buyers' Best Chance To Close A Loan

Detroit, Cleveland, and Dayton, Ohio are the least expensive U.S. metro areas to buy a home, according to a new report from tech-driven real estate brokerage Redfin. That's as of March 2025. In those three cities, the median home-sale price is under $230,000, offering first-time and younger borrowers a better chance of homeownership. 

Four more places in the Rust Belt, including Rochester, N.Y., Pittsburgh, Buffalo, N.Y., and St. Louis, Mo., and three in the South — McAllen, Texas, El Paso, Texas, and Baton Rouge, La. — complete Redfin’s ranking of the top 10 U.S. metros where the median sale price of homes is cheapest. 

In all 10 of those metros, the median home sale price is under $265,000, Redfin noted. By comparison, the national median home sale price is just over $431,000, based on the company's analysis of median local home sale prices in the 91 most populous U.S. metro areas.

Note that even among the 10 least expensive U.S. metro areas to buy a home, sale prices are substantially higher than they were a decade ago, the report authors noted. According to the table below, the median sale price has more than doubled in four of the 10 least expensive U.S. metros and nearly doubled in another three since 2015.

“In many Rust Belt cities, buying a home is inexpensive compared to the rest of the U.S. because they don’t have the high-paying job opportunities of coastal cities, or the warm winters of southern cities,” observed Redfin Chief Economist Daryl Fairweather. 

“Those places are also much more affordable to locals than the rest of the country, particularly California and New York. For buyers priced out of expensive coastal markets, especially people with geographic flexibility like remote workers or retirees, a place like the Rust Belt or parts of Texas are attractive for people looking to stretch their dollar.”

These metro areas might also be the best shot first-time homebuyers and younger buyers have at closing a loan and owning a home. 

Source: Redfin

In eight of these 10 cheapest metro areas, buying a home is affordable, as Redfin sees it, in addition to being inexpensive. Detroit, Pittsburgh, and St. Louis are the most affordable places among these metros, with homebuyers earning the local median income needing to spend 25% or less of their earnings on payments for the median-priced home. 

Affordability data comes via a Redfin analysis of median local household income and median home-sale prices, assuming a 15% down payment and March 2025’s average 30-year fixed mortgage rate of 6.65%. Redfin considers buying a home “affordable” if a household earning the local median income spends no more than 30% of their earnings on the monthly housing payment.

Again by comparison, U.S. metros with expensive homes are much less affordable: in Los Angeles, for example, homebuyers earning the local median income would need to spend nearly 77% of their earnings to afford the median-priced home ($905,000).

Housing affordability remains a huge challenge for borrowers in the U.S: 

• The median U.S. monthly housing payment is at an all-time high of $2,870, due to still-rising home prices and elevated mortgage rates, Redfin reported at the beginning of May. 
   
• Those record-high costs, along with economic turbulence and recession fears, are pushing prospective homebuyers to the sidelines. 
   
• Renting is cheaper than buying a home in every major U.S. metro, and a 2024 Redfin survey found that nearly 40% of renters actually believe they’ll “never” own their own home.